Increasing incentives and ensuring transparency in the draft Law on Corporate Income Tax

Minister of Finance Nguyen Van Thang

Strengthening tax incentives, promoting sustainable development

The draft Law amending and supplementing a number of articles of the Law on Corporate Income Tax was developed to institutionalize the policies and orientations of the Party and the State, especially in encouraging the development of priority sectors, industries and localities. Minister of Finance Nguyen Van Thang said that the drafting agency has carefully reviewed current tax and investment laws and regulations, and consulted international trends to improve the effectiveness of tax incentive policies, avoiding widespread incentives that erode the tax base.

At the 8th Session, the Government proposed many solutions to improve corporate income tax incentives, focusing on priority subjects, sectors and areas, including high value-added product manufacturing industries, science and technology, digital transformation, innovation, green economy , environmental protection, agricultural and rural development, as well as public service activities and areas with difficult and especially difficult socio-economic conditions.

The review and rearrangement of the tax incentive system is carefully calculated so as not to affect current incentive policies, while adding new outstanding policies to facilitate businesses to expand investment in encouraged fields and locations according to the policies of the Party and State.

The Minister said that the drafting agency has studied international experience and trends in applying tax incentive policies around the world , especially in the context of implementing pillar two on global minimum tax. This helps to build appropriate incentive policies, continue to effectively attract foreign investment capital, and at the same time encourage the participation of economic sectors, especially the private sector. In the process of implementing pillar two, the drafting agency has advised the Government and competent authorities to study indirect support methods for businesses, ensuring compliance with international commitments and agreements that Vietnam has participated in.

Ensuring the unity and uniformity of the legal system

To ensure the consistency and synchronization of the legal system, the draft law has added a provision: in case other laws have provisions on corporate income tax incentives different from this Law, the provisions of this Law shall apply. Minister Nguyen Van Thang said that this principle aims to focus tax incentive policies in tax legal documents, ending the integration of tax incentives in specialized laws, thereby ensuring comprehensiveness, consistency and ease of implementation for both the political system and enterprises.

In response to the opinions of National Assembly deputies, the drafting agency committed to continue reviewing specialized laws with provisions on corporate income tax, including laws passed by the National Assembly at the last session of 2024, laws expected to be submitted at this session, and the last sessions of the year, such as the Investment Law, the Law on Support for Small and Medium Enterprises, and many other laws. In particular, tax incentive provisions in the Capital Law and resolutions of the National Assembly on piloting specific mechanisms and policies for a number of localities, sectors, and fields will continue to be implemented according to current documents, not included in this draft law for general application nationwide.

Outstanding offers for science and technology

Implementing Resolution 57 of the Politburo, the draft law proposes breakthrough tax incentive policies to promote the development of science, technology and innovation.

Minister Nguyen Van Thang emphasized that the current Law on Corporate Income Tax has stipulated many outstanding preferential policies with the highest level for activities such as scientific research, technology development, high-tech application in the priority list under the Law on High Technology, high-tech incubation, high-tech enterprise incubation, venture investment for high-tech development, and many other fields.

This draft law adds new incentive policies, including: funding for scientific research, technology development, innovation and digital transformation is deductible when calculating corporate income tax; expenses for these activities in enterprises are deductible when calculating tax; income from contracts for scientific research, technology development, innovation and digital transformation is exempt from corporate income tax; and public scientific and technological organizations and non-profit public higher education institutions are exempt from corporate income tax.

To ensure flexibility, the drafting agency proposed that the Government prescribe additional spending levels, conditions and scope of application for research and development expenditures, instead of specifying specific levels such as 150% or 200% as in other drafts, following international experience to avoid having to amend the law frequently. In addition, tax incentives are not only added in the Law on Corporate Income Tax but also in other laws such as the Law on Export and Import Tax, the draft Law on Personal Income Tax in place, and the draft law amending 7 laws in this term, ensuring the synchronous implementation of Resolution 57.

Time limit and institutionalization of Party resolutions

Receiving the opinions of the delegates, Minister Nguyen Van Thang agreed to propose the law to be applied from October 1, 2025, and committed to developing timely guiding decrees for immediate implementation. Incentive policies related to Resolution 68 on private economic development and Resolution 57 on science, technology, and innovation will be institutionalized in this law or upcoming laws. The Government is submitting to the National Assembly a resolution to implement Resolution 68, with stable policies included in the law and policies that need to be piloted as stipulated in the resolution for adjustment before concretization.

Source: https://thoibaonganhang.vn/tang-uu-dai-dam-bao-minh-bach-trong-du-thao-luat-thue-thu-nhap-doanh-nghiep-164017.html